next. tracy: i'm in for gerri willis. beginning with two breaking news stories. first, house speaker john boehner sent a counteroffer to president obama to fend off the fiscal cli. in a response to an offer made by the white house yesterday, we go to rich edson from washington, d.c. with the latest. rich, any response from the white house on this? >> still working on that.

aids say in exchhnge of proposals taken place, some movement, but still major differences between the white house and speaker's office. fox news reports the speaker and president just spoke on the phone. white house folks s there's a sign of movement. a senior huse aide says the evite house reduc the and the white house has reduced itsm demand for tax revenue increases from just under to fund the store one-and-a-half to will sort of the latest republican billio offer of $800 billion.e there is anfother offer on the t table from republicans. the details are known.ys the spokesman said the white house got up counter offer tois. solve our looming debt crisis. we are still waiting for the white house to identify what pet spending cuts the president is willing to make as part of the balanced approach.use fox news is reporting senior white house official said the signs are making some progress,e

but there is still littler movement on the majorferences. substantive differences.back ty. we are watching and all. back to you. >> and now you are. thank you very much. deal weigh more on this deald throughout the next hour, and we are going to hear from bothcapio chambers barasso in ten minutes. the 0*er breaking story, a devastating defeat for one of the most important union strongholds in the country, michigan. michigan's governor, rick snyder, moments ago, signed right to work legislation into law. now, the new law sharply limits union power, something once unthinkable. hundreds of protesters packed inside the capitol building for the vote. trooper on hand in riot gear. michigan, home of the most powerful union in the country, a symbol of union power and dominance for generations. not anymore. workers are no longer to give up part of their paycheck to union

dues. now, the unions didn't go down without a fight. literally. take a look at this, outside the state capitol. the moment the bill passed, things got violent. tents belonging to americans for prosperity, who were there to suppt the bill, torn down. one of the groups senior staff, steve, who is actually also a fox ws contributor was brutallyassaulted as he tried to prottect his staff. nuts. joining us now, thee most senior republican lawmaker who voted today, the house speaker, thank you for being with us today. this is monumental on so many levels. we have a michigan republican controlled legislature right now. is that why you dove into this now while you could? >> tracy, thanks for joining us. this is a monmental night because it's a monumental win

for michigan's workers. we kept the focus on the workers, their freedom to choose which organizions to join and what they don't want to join. we know there were clashes. know people demonstrated inappropriately, but good stories as well. clnup happening on the lawn by the demonstrators, but the point is throughout it all, we haveto keep focus on people going to work every day to literally build our state. tracy: right, because now it's easier to woo companies into michigan to bring obs; right? the states like south carolina, alabama, texas, have seen a boom in companies coming to work there because, well, it's easier, and it's cheaper african-american they don't have to -- and they don't ha to deal with the unions. >> two policy conversations that happened, and then there was the political. the democrats and union bosses focused on the political, but the two policy conversations were about granting workers the freedom to make their decision. the other is about making michigan is better place to find a job, attract new jobs and better ceers for the workers.

that's why i say today is a win, a game changer for michigan because it's a game changer for the workers. tracy: clearly,poltical. president obama, hesmtion, aid it had nothing to do with economics, but with politics. obviously, worried now about political donations when union dues no longer need to be collected. >> again, the president spoke clearly about the politics, but we're focused on the worker, and the president has a job to do. i wish he'd get that job done. we're going to continue to get our job done here in michigan, reinventing our state, making sure we turn our state around, making great process to continue that. tracy: are you worri it ends up back in the courts? they fought it in wisconsnsin. it was partially overturned there. are you worried we can see a repeat of that? >> certainly, as you see the political process weigh out, when people don't win at the ballot box and democrats and unions did not, when they don't win the vote, they do, unfortunately, often turn to the

courts, and we expect that's possible. that's the right to do that, but we made sure we kept the focus on the michigan workers. tracy: unions claiming they were bamboozled; right? there's a large imbalance of power at ts time in michigan. republicans hole the majority of it. are you surprised how violent it got at the end of theeday? >> i was disappointed by that. we should have a conversation about the merits of the issue, talk about our workers. we can have passionate debate, and if you saw the foor of the house, that's what we had. we had passionate debate, but, unfortunately, people turned violent. that's unfortunate. it's not appropriate. keep the focus on moving the state forward. that's where keep focus. tracy: back to the economics, michigan's unemployment rate 9.1%, nationwide 7.7%. i presume you hope this brings jobs to your people, again, companies now can be courted. >> solutely. we are continuing to make michigan the better place to find a job. to do that, continue to make

michigan a better place to provide a job. that the focus. that's what this is about, making sure workers have opportunities, and i have to say miigan's work force is the best in the country. they get up every day and work hard to literally build, grow our state, and so they want to do that. we give them the opportunity to do that. we have are happy to have the investment and new business here in michin. we are open for business. please, come here. tracy: fought for the people's first amendment right, and if i'm struggling, and i get a paycheck every week, i'm not sure i want a it to go to union dues, but my family. mr. speaker, thank you, for fighting the fight, you ha a long road ahead of you, though. >> thanks, tracy. tracy: all right. meanwhile, is more fed stimulus needed to boost our economy? is the fed actually doing more harm than good? federal reserve policymakers meeting today and tomorrow to discuss more monetary policy. now, it's the last time they get together this year, and some say

get ready for the launch of qe4 potentially as soon as tomorrow. that news made investors happy today with the dow rising for the fifth day in the row. s&p ending at the best level since election day. joining me the federal reserve governor wayne engle. governor, thank you for being with us. doing more harm than good by putting more money in the system? there's a law that diminishing returns that kicks in. >> well, it doesn't have to be that way. it is that way somewhat because the fed is paid that 25* -- 25 basis points for banks to hold sterile rereceivers, and the regulatory thrut is don't make loans. make loans, criticize them, and so the hassle over regulatory restraint on lending and paying to excess reserves has left us th not a very effective

monetary policy at this time. tracy: right because f i'm a bank, why lock into a 30-year mortgage when the rates are so low? i won't make the money. there's that side of the coin. on the other hand, as a person out there looking for a home, i'not really sure i'm convincedded rates are going up soon so i'll sit and wait it out. as a result, we have nothing going on. >> well, that a little bit of a problem, but the good news is commodity prices are not rising. the change is very, very stable. it's almost more stable, if that's what the fed was trying to do. we don't have a huge overhang of liquidity driving commodity prices up while we've got the price of houses. tracy: okay. >> rising and moving higher, which is a good sign.

tracy: so then what ould they do tomorrow what should we hear from the fed? operation probably ending, no short term securities left to buy, buying mortgage-backedded securities. is this necessary or should we, at some point, just step back and let the little kid try to take its first steps on its own? >> i am hopes the members of the fed who prefer the focus to be on the economy and economic signs that monetary policy is right as compared to those who promise what the rate will be in 2013 and 2014. that's a real mistake. tracy: right. that's difficult. are you worried about the value of our dollar, though? >> well, the value of the dollar's been holding fairly well in here, just as commodity problems felt stable, also, the value offthe ollar held steadier, and it looks at this point asif u.s. exporters are

doing a little better and u.s. producers are driving out some of our imports so that was good news, more econic groh. tracy: hard to tell, though, because everything's overshadowed by the fiscal cliff. do you worry, like, inflation is going to come and bite us in the butt one of these days? i mean, there's a lot of moy out there. >> well, i watch that very, very carefully, and i don't think that's an immediate risk. in regard to the fiscal cliff, i think the right thing to do is to let the tax rates go up across the board, just like they agreed to do. i think we ought to have middle income americans as well as high income americans having a reduction of those tax rate cuts we saw. tracy: take more from my paycheck, let the fed put money into the system. does it make sense at the end of

the day? shouldn't i keep my money, g out there and spend it and let the fed keep theirs? >> well, that's, you got a good point, and i agree that instabilit and monetary policy is not very effective, and so i' not looking for very much from the fed tomorrow. tracy: no, yao not alone, sir. wayne, former fed reserve governor, thanks for taking the time. >> you're welcom. tracy: all right. well, if you are fired up about this or any of theissues on the program, drop the show an e-mail at gerri@foxbusiness.com. coming up on "the willis report," house speaker boehner and the republican accusing president obama of kicking the can down the road. >> t longer they slow down the process, the closer our economy gets to the fiscal cliff. >> two .o.p. lawmakers here to share their reactions next. can china take over america? is it already happening under our noses?

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tracy: speaker boehner warning e white house to be serious to callll cliff, and the majority leader throwing in the towel saying it's difficult to reach a deal by christmas. crazy. with more, senator barrasso from wyoming. do you have any idea what's in the counteroffer? >> i don't have the final details on that, tracy. we have to avert the fiscal cliff. my concern is it drives us into recession, knocks up employment up, and i agree with you, we have to ensure more peopl have

more of their own money in the pockets to decide what to save, spend, what to invest, and anything that hurts our fragile economy, i think is bad for all americans, especially those like you talk about, trying to put food on the table and get the kids to school. acy: anything you come to the tail on? concessions to give into in order to get it done to avert the cliff? >> john boehner talked about increasing revenue. i think we need to do that through jobs and growth and getting more people back to work. unemploymentnumbers continue to be very high. our big problem is the sending. we continue to spend too much, and we have to make adjustments now to make sure we save and protect medicare and social security for future generation. tracy: there's no talk about that. raise taxes six ways until tuesday, and it's not covering the debt or spending habits at the end of the day. it's unfortunate. so many american households,

trimmed down, curbed spending in light of what's happened the last couple years, and, yet, the government has not. when does that start to be part of the discussion? >> you're right, trac i think the president is misleading the american people when he says all we need to do is raise taxes on the certain group. that would bring in the amount of revenue to fund the government in a year for only seven days. tracy: right. >> so what about the other 51 weeks of the year? that's the real question. the president refuses to talk about that. he basically implies in his speeches that if we raise taxes on 1 #% or 2% of the country that that will solve all the problems, when, in fact, that's not true. tracy: is part of the problem the process? you know, your fellow republican senator, ran johnson of wisconsin, saying it's absurd, at the end of the day it's the president, boehner, and their respective staffs. somehow or another, they make us a deal. is that fair at the end ofthe day?

>> well, there's only one person in the united states that has the n that can sign the law, and that's the president, and there is oneperson that can bring the bill to the house that has to pass that house of representatives, and that's john boehner, but, you know, speaker boehner has a lot of input from all the members of the house so from his party, the other party issue and he's getting plenty of input, but ultimately, something has to pass the house, signed by the president, and i think whatever that agreement is will pass the senate, tracy. tracy: you know what? we hear so much about federal tax rate increases, not a lot of talk about what's going to happen with the estate tax if we go over the cliff. i know in is a sensitive issue to you at home in wyoming. you got a lot of farmers. where are we on the estate tax? >> if nothing's done come january 1st, the etate tax rate, the death tax rate goes from 35 #% to 55%, and, you know, right now, it's on the state's over $5 million, and it

drops down to anything over $1 million so for farmers, ranchers, small business owners all around the country, the dry cleaner or the flower shop or car wash, all of those people that had businesses in their family, they more likely have to sell because they are not going to be able to pass them on because they have to pay the taxes immediately. tracy: any discussion of this in the talk? have you heard anything? anybody conceding or bringing rates down? >> i continue to talk about it, put out a republican policy committee paper today, going through all of that, but the democrats don't eem to want to talk about that because they view that as additional money that they would have that they could spend, and the american taxpayers know you send more money to washington for the most part, washington wastes it. tracy: no joke. senator barrasso, thank you for taking the time to be with us, sir. >> thank you, trcy. tracy: ain't that the truth? all right? we have a lot more still to come this hour including a new report

on the success of both the boehner and the obama fiscal cliff plan. hint hint, neither are successful. now, does the speaker of the houshave the file behind him in the deal making progress? are some lawmakers breaking away from theeader? congressman tim gives us the scoop next. we'll be back. ♪ ♪ [ male announcer ] they are a glowing example of what it means to be the best. and at this special time of year, they shine even brighter. come to the winter event and get the mercedes-benz you've always wished for, now for an exceptional price. [ santa ] ho, ho, ho, ho! [ male announcer ] lease a 2013 glk350 for $399 a month at your local mercedes-benz dealer. gives you 1% cash back on all purchases,

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tracy: does speaker boehner have more than a fiscal cliff to worry about? up next, will the top republican the house stay

tracy: speaker boehner 1 not the only one facing the challenge of keeping the u.s. from falling off the cliff, but he's keeping the top post in the new year,

and finding that cou be a challenge. will the house see a shakeup in 2013? let's ask the republican congressman of kansas accusing speaker boehner of punishing fellow conservative members in the house. sir, talk about that first so you have been removed from the budget committee, agriculture committee, voted aginst raisinn the debt ceiling, and you didn't vote party line so boehner gave you the boot >> we believe conervatives were punished by a secret score card that the speaker refuses to release. back room deals, removing folks from a committee or a deal with the president, that makes e nervous, and every one i talk to nervous as heck as to what's going on behind the closed doors. tracy: last thin the american people want to hear; right? we need to get a deal done. everybody wants to har a version going on right now. we don't want to hear that they

are fighting among the ranks. why do youthink this is? >> well, there's folks in e republican party, stating it clearly that they are looking to raise taxes, and i think the last thing republicans want to do is help the president raise taxes, but what we have to remember is the last time there was a closed door deal between the speaker and the president of the united states, we got a 2.3 trillion dollar increase in our debt ceiling, and we had no cuts to show for it, and that's why %-year, the speaker and thehe president are both trying to undo the cuts they agreed to in august 20 # 1 # 1. that was a bad deal then, and rit now, they are trying to undo the minimal cuts agreed to a year and a half ago. tracy: okay. you think because you did not vote to increase the debt ceiling because you are not going to vote for increases in taxes, you're thinking that john boehner is actually going to come to the center a little more, and we are, potentially, going to see some tax increases, on the wealthy at least by the end of the day? >> talking $800 billion in

revenue increases, we have not seen details or details of what cutsts either side offers for a ranking file member like myself, but after $800 billion on the ble, i don't see that without tax increases. that worries m. tracy: what worries me now is because it's coming down to his re-election now, isn't it? speaker john boehner has to be re-elected. if he does sort of curve to the left and finds his way down the middle, he can almost guarantee he's re-elected; right? >> well, he has to earn the trust of republicans, particularly conservative republicans. if he brings it through and pushes it through, that ruins the republican brand forever. we barely convinced the american people we're against tax increases, but if they pass a tax increases, we're on the road to the minority. that worries members of the conference irrespective of the cliff created, again, by a bad deeing in august 20 # 11 that

the american people said don't raise the ceiling, washington raised it, cut spending in the future. that sounds awfully familiar from the white house and out of the speaker and the majority leaders as well. tracy: do you have anied what's -- whatever boehner presented to the white house tonight, do you have any idea what's in the compromise? >> none whatsoever, no details gimp to us, again, undecled cuts, but what i can be certain about, any cuts they talk about are cuts sometime in the future. washington did this year after year, decade after decade. this is not a republican or democrat problem. it's a washington problem. they won't cut spending. i fear republicans are going to raise taxes to pay for president obama's spending. that's wrong. it's not going to work. that leads us over into a debt ceiling disaster and a possible downgrade of the credit rating. tracy: all we're good at is kicking the can.

keep fighting the good fight. don't give up. >> we won't, thank you. tracy: good. we're like beckham, kick, kick. when we come back, is try -- is china trying to take over? a look of their moves inside the u.s.. president obama get his way or boehner or either? who knows. the results of a new report next.

tracy: the future of our country hinging on our grdlocked congress. does that make you feel better? so far the fiscal plans put forth by the president and speaboehner simply wonnt cut it. a new report out find neither proposal reduces our debt enough to solve our economic crisis putting the country at, well, further risk for another

downgrade. anybody want to talk abou august last summer in what will it take to get the house in order? ask alex, research fellow at the american enterprise institute and former chief economist for the house ways and means committee. alex, here's the thing, it's tax on both plans. >> well, to do go to your opening remark, you're definitely right. the's a short term crisis where taxes are set to skyrocket on january 1st and long term challenges that can want be met with tax increases alone. mathematically impossible. we have health care spending growing faster than the overall economy. there's no tax policy that can rectify that situation. tracy: why spending? why hasn't anybody brought spending entitlements to the table? >> well, i think we have. the speaker is talking a lot about the need to deal not only with the expiration of the bush

tax cuts, but to look beyond the next few weeks and looming fiscal challenges and talk about more structural changes, and so there's a host of policy options out there. i'm not sure which ones he's advocating, but with regards to social security or medicare, the eel jilt age, those are all policies to help bring down federal spending on health care and entitlements. tracy: agreed, but not much traction at this appointment. a debt to gdp ratio at 70% puts us at greece. they are 162%, we are not near that, but do you worry this could bring us there someday? >> well, that's exactly the right metric to think about how much debt we have relative to how big we are that's how we think about how much house we can afford on an individual level, and that's how the government should be thinking too. how much the u.s. government is sustain in terms of debt to gdp.

luckily, we don't know. 70, we could survive in terms of the sense we won't bespialing out of control, but the higher that ratio is, then the more that future generations, their taxes go simply to service the debt for the services that their parents and grandparents enjoyed. tracy: right. >> it's the right way to think about the problem. get the number dun as soon as we can. tracy: the answer will be continue to raise axes to make those interest payments which is circular and arguably stupid at the end of the day. talk about the tax code. how do you do it? it's a big book of favors. it is a doorstop at this point it's so big. do you throw it out and start over? >> wellll, it's interesting. you know, for a long ime, in the 1990s and the early part of the 2000s, there was a lot of chat about throwing it out and starting over, and i think that conservatives note that if we do that, we would start over with the system much more efficient than the ones we have. we start with the consumption

tax system. the dialogue moved away from that frame work all together, and now were talkin about reforming the system we have. income tax reform, but there's still radical ideas within that structure. you're right, it's filled with favors and distortions, and by closing those down, we're going to have a better tax code overall. tracy: good luck with that. you got lobbyists that are powerful who want their deductionsll ove kingdom come. quickly, talk about the corporate tax, ranked 69th in the world as a good place to do business because, well, our tax code is so erroneous, and we talk the bejesus out of you. if we get the corporate tax down, repatriate dollars into the company, companies like google and starbucks bring it home again. why isn't that being discussed? >> good point. there's a lot of interest in corporate tax reform. we got basically the highest rate in the industrialized world, 35%. that rate should be 25% if ot

lower in order to put us at just on a level playing field with the kinds of tax systems that european tax systems have, and that's a -- you're talking about downtown lobbyists and k street, a lot of interest in the business community for that reform. it takes energy of political capital to make those changes. there's a tradeoff in dealing with the cliff and the immediate tax increases on individuals and the capacity to also think more fundamentally. tracy: i hear you. there shouldn't be a tradeoff. we knew it was coming. we saved it for the last minute. it's like people taking laxatives to lose the last five pounds before a wedding. it doesn't work. alex, former ways and means committee, chief economy, it frtrates me, sir, thanks for being here. >> all right, thanks for having me on. tracy: you have a burger, and it's back on again. we have a fox business alert now.

british bank agreed to pay $2 billion to settle a money laundering probe. the justice department says they broke the law in connection with the laundering of money from narcotics trffickers in mexico, lieve it or not. they say hstc intentionally allowed prohibited transactions with iran, libya, sudan, burma, and cuba. the ceo says the bank accepts responsibility and is profoundly sorry. really? that was it. coming up, is the ford fusion all it's cracked up to be? we'll ask consumer reports. this makes me giggle. they are already the largest international holder of our debt, but now china buying up american company after company. what are they up to? we'll have that story next. we'll have that story next. ♪

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♪ tracy: a record year for chinese investment in e u.s., leaving many to fear that china is taking over. case in point, the chinese have snatched up six and a half billion dollars in u.s. assets just this year alone. that breaks the previous record of just over 5 billion in 2010. our next gut says there is a big reason to be concerned. some of this year's deals are dangerous to our country. here to explain what china wants is the author of the coming collapse of china. i'm glad your year because this sounds really scary. you worried about this? aig, 4 billion. that is the biggest chinese takeover thus far. u worry that this is going to be a trend? >> it's certainly going to be. what's happening in china is that enterprises don't have the opportunities there because their problems and the chinese economy right now it's a pretty

serious. these enterprises are going around the world buying assets because the returns are a lot better. so a lot of this activity does not concern me, but some of it does because you see in certain acquisitions like a one to three systems, the battery maker, the canadian oil sands producer. they're looking for technology. and some of this technology has defense applications, like this battery maker they're buying this stuff up. that is something we have to be concerned about and should stop. tracy: do you worry -- we ha an election. there are new people leading. you worry that the new leaders will make this even worse? >> the leaders in china right now, the so-called conservatives, but in the chinese context that means hard-line anti reformers. they want to clo up opportunities for foreigners. when you have these chinese enterprises going around the world buying assetsts, the opportunities for not only foreign companies but also a domestic, private entrepreneurs,

the private people are being narrowed. that is real problem for china because it's an entire rform. tracy: the other thing is that currency manipulation and the fact that our best fishing does not ace as much weight on this >> u.s. law requires treasury to designate a country occurrence manipulator if it manipulates its currency and thus to get traded vantage. if we're not going to enforce our own law, that's a real problem. good policy or bad policy, we need to enforce our laws. the chinese, they realize were not serious about china's trade violations, and this makes beijing much more intransigent. tracy: you said to me that china needs is more than we needthem. >> for short. last year 190 percent of china's merchandise trade surplus related to sales to the united states meaning they run deficits with the rest of the world so they run this enormous surplus with us.

that gives us leverage, but only if we carry use it tracy: i remember when i was a kid they said japan was buying of rockefeller center. japan's by to take over the world. that never happened. >> no, but japan was our ally. we could deal with thejapanese on a reasonable basis. the problem with china is that it sees itself as supplanting the united states. has been very hostile and aggressive in recent years. it's trying to push the u.s. out of asia. they are not our friend, and so we don't want to give them a foothold in our economy. trac that being said, how do we stop this? do we not allow these deals to happen? in the u.s. is basically putting a defense. >> the chinese put up a fence. we couldn't buy if it were a chinese enterprise. we can stop this because the committee on foreign investment in the u.s. has the final say on sensitive acquisitions. and so they cann stop the acquisition. tracy: that probably should have >> they should. tracy: thank you fobeing here.

the coming collapse of china. it is coming. >> it is. tracy: we want to know wha you think about all this. here is our question tonight. is the u.s. still a superpower or will china be number one soon? log onto gerriwils.com and vote on the right hand side of the screen command we will share the results of the end of the show. coming up, is it the case of false advertising? "consumer repports" says the fod fusion is not as green as ford says it i. come on. we're going to have details trick from the magazine's mount next. ♪

[ heart beating, monitor beeping ] woman: what do you mean, homeowners insurance doesn't cover floods [ heart rate increases ] man: a few inches of water caused all this? [ heart rate increases ] woman #2: but i don't even live near the water. what you don't know about flood insurance may shock you -- including the fact that a preferred risk policy starts as low as $129 a year. for an agent, call the number that appears on your screen. tracy: ford redesigned high reserve fund. the biggest selling factor. fuel economy.

tracy: so, you're looking to buy more fuel-efficient car? well, you might be shocked to find it is not as fuel-efficient as you thought. "consumer reports" of the road with two of the ford 2013 hybrids and found these models just not living up tonight by a long shot. joining us now, consumer reports managing editoror autos. i love the year here and we're ing this story becuse man, oh, man, they tout these cars as gre is green can be. >> we are seeing them all over the weekend. football games, 47, 47, 47. it's an impressive number. the cars did very good mileage and on tests, but they are not hitting that. tracy: will lead the hitting? >> so we're seeg is about 37 and 38 mpg overall. almost ten less than represented for the fusion.

again, these are still stellar numbers. the for fusion hybrid is the top sedan in the testing for fuel economy, bested the tenth tee but toyota camry hybrid. but in our real-world test or we drive the cars on the road and leader of the fuel that we use, we are seeing mileage that is much less than those 47-mile per gallon overall numbers. tracy:till great, but it's not what their advertising. i think that's really important that people understand. you're seeing you see this and other cars a well. toyota, honda, but that were just off the mark. >> we have done, 80 percent of the cars we test we hit the same tool number that theepa does or within one or 2 miles per gallon. there are some vehicles, and they tend to be hybrids that are allies thathave five or six miles-per-hour -- per gallon difference. the turret of priests, even the buick lacrosse . anywhere from three to 6 miles per gallon difference.

these reviews. tracy: no real basis of comparison. nothing out there for us to look at as well worked in the past, what difference -- didn't. we aren't going on these tests that we are making it as we go. >> the epa has their see test because it is epeatable. every manufacturer has to put their vehicles through. this select 10-15 percent of the cars and verify which is what they're doing with fort to verify the for testing. we don't know if it has been as system, we don't know if ford misstated. that's just out there. that's what the epa will verify. we verify our tst, do a repeatable test on our track, public roads, and we are able to say confidently that is where we are, 7-9 mpg lower. tracy: i venture a guess that "consumer reports" has more credit than the epa. i think people are going to go with you. you guys also did a top-10 most reliable american cars. were any of these of list? >> well, the new fusion does not

have reliability data, so e can't put those up on the lst. actually, the american list that we have domined by general motors. equinox x cd, the new chevy sonic. one ford vehicle, the ford mustang. but these are too new. the path -- the past fusion was really reliable. with the redesign. tracy: i love that there was a stang on the list. do you thinkhat based on of this we will still see more hybrids coming to market? >> we are going to see more hybrids because of the new epa fuel requirements, the new cafe requirements that are going for it. there is going to be a whole diffent variety or all variety, really, of fuel systems. or going to see battery, gasoline hybrid, really efficient gasoline engines. don'discount the gasoline engine with a six, seven, eight speed transmission and a smaller engine you can get some really great mileage. tracy: consumer reports managing

editor for i know. thank you. >> tha you. tracy: don't believe the hype. all right. the fourth fusion may not get high marks, but it does have a pretty high price tag selling for an average of $27,000. that is just under the median price for vehicles in the u.s. of just over 30 grand. tonight's top five, the cheapest cars for sale of the u.s. according to edmunds. the kiev riel. and just like ying that. the sedan as a starting price of under $14,000 which could account for the car consistently selling around 30,000 of lung each year since 2007. number four, the ford fiesta. the 2013 sedan ha gas mileage of 29 mpg. but its $13,000 price tag is not making it too popular. this year ford sold only 51,000 cars compared to about 69,000 last year. number three, the smart 42. this car sells for just under

$12,500. it has only sold 9,000 vehicles so far this year. it gets about 30 miles per gallon, but it is made of 85 percent recyclable materials. so all this paper when i'm done using it goes into the car. it oesn't sound reassuring to me. i have to tell you. number two, this shabby spark, one of the best-selling cars of the year, selling over 10,000 cars in just five months. more than the smart card did in the whole year. $12,000 price tag also includes a five-year warranty. bonus. and the number one cheapest car for sale in the u.s.'s the nissan versa, the only 2013 ca that will be cheaper than $12,000 for at least the manual transmission model. already sold 150,000, more than a hundred thousand sold last year. there could be a reason al these cars are so cheapto buy.

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♪ tracy: finally tonight, it just never seemed to amaze me what some people spend money on. last week we told you about the starbucks steel gift cards priced at $450. bad enough that people are spending $450 only gives you $400 with a credit. the other 50 guesstimating the actual card. now one of those limited edition cards just solon the bay for nearly $1,100. in fact another are more than 100 steal cards listed on the bank. as of this afternoon, of them e going for at least $600. some even have the buy it now option of more than $5,000, and it's not just one person. several of the cards listed for at least800 havze